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10-Year Yield Increases as Jobless Claims Come in Lower Than Expected

Source: NYSE
  • The U.S. Labor Department reported U.S weekly jobless claims totaled 364,000.
  • Auctions are scheduled to be held on Thursday for $40 billion of 4-week bills and $40 billion of 8-week bills.

U.S. Treasury yields rose slightly on Thursday, as weekly jobless claims data came in lower than expected, a promising sign ahead of the big June jobs report Friday.

The yield on the benchmark 10-year Treasury note rose 2.6 basis points to 1.47% at 4:00 p.m. ET. The yield on the 30-year Treasury bond advanced less than a basis point to 2.071%. Yields move inversely to prices.

The U.S. Labor Department reported weekly jobless claims totaled 364,000 for the week ended June 26, a pandemic low. Economists polled by Dow Jones were expecting 390,000 claims, after totaling 411,000 the week prior.

The unemployment data comes one day ahead of Friday's closely-watched jobs report. Economists expect 683,000 jobs were added in June, according to a Dow Jones survey.

Payroll firm ADP on Wednesday published the number of private payrolls added in June. It reported an increase 692,000 payrolls added in June, above the 600,000 expected by analysts.

Investors are watching jobs data closely to see if it prompts the Federal Reserve to consider tightening policy sooner than expected.

Michael Harris, the founder of Cribstone Strategic Macro, told CNBC's "Squawk Box Europe" on Thursday that he believed Fed Chairman Jerome Powell's messaging about a stronger jobs market in a year's time was an indication that there would be an interest rate hike next year.

"I think he's moving towards a hike sooner than people expect, but I don't think that's a problem because the first hike is not going to be an issue," Harris said.

"The issue is we have way too much stimulus because the current central bank stimulus was built to help the economy deal with absolute shock," he added, arguing that economy was no longer in "absolute shock" so there was no reason why interest rates are where they currently stand.

Auctions were held on Thursday for $40 billion of 4-week bills and $40 billion of 8-week bills.

CNBC's Maggie Fitzgerald contributed to this market report.

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